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Stations do not have to be very elaborate. A typical rapid transit station has a platform about 3-1/2 feet (about one meter) high. The straddling bus will work well with a similar side platform about 8' (about 2.5 m) high. Under the platform there is enough room for the sidewalk to continue on through. The only significant addition would be sliding doors that close off the front of the station when the bus is not there. Pedestrian flyovers are optional and may go with regular bus stops as well.
Most maintenance would be no more disruptive compared with repairs around rail rapid transit. Actually most of the maintenance could be done in a way keeping the track itself open during most of the daylight hours.
Oh my God! No the bus won't be barreling towards you. It will be going the same way you are. If the bus came up from behind and your fender or your rear view mirror was in its way, the bus would stop, although it might photograph your car and you might get a violation notice in the mail if you were straddling lanes.
Yes it would save time, provided motorists stayed in their lanes letting the bus pass over them. Actually in most cases it would be drivers overtaking the bus from underneath, saving time for themselves. I do not expect that the bus will be going faster than cars very often. There won't be that many straddling buses in the streets that traffic signals could not give them their own green light while other traffic is stopped.
Unlike ordinary trains or streetcars, the stradding bus could use only one rail for steering. It would be too difficult to keep the wheels on both sides "in gauge". But a rail on the other side together with flangeless wheels would reduce rolling friction and make the bus (should we call it a streetcar?) more energy efficient. By the way, many funicular railways, cog railways, and cable pulled railways up mountains have flangeless wheels on one side and the wheels on the other side guide the trains around each other as they pass in the middle of the route. Another alternative is having no rails and using electronic steering along a line painted on the street.
For just the first route, it is not a big risk for the city. Later, if other companies decide to tool up to make these straddling bus systems, then the city could take bids.